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Fidelity is making changes to its Multi Asset fund range

15 June 2018

Fidelity is making changes to the investment policy and OCF for a number of Fidelity Multi-Asset funds

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Fidelity has advised that:

“The revised investment policies will take effect from 20 June 2018. They will allow the portfolio manager of the Fidelity Multi Asset fund range to invest more than 65% in Fidelity funds (within an Irish UCITS fund, Fidelity Common Contractual Fund II) that use the experience and specialisms of a number of investment management companies (which may include Fidelity) to select the underlying assets.

Making greater use of investment managers other than Fidelity means that you may now benefit from underlying investments in a wider range of asset classes and investment styles.

We are able to invest with these other investment managers on very favourable terms – at fees considerably lower than those you would pay as an individual investor. However, these costs are higher than those charged when we only had access to our own investment team, so there will be an increase in the ongoing charges for most share classes. We believe these higher costs are outweighed by the additional return potential and that these changes are therefore in your best interests.”

These changes will affect the underlying fund objective and OCF of the following funds:

Fidelity Wealthbuilder

The new fund objective and investment policy will be:

The Fund aims to provide long term capital growth through global exposure to higher risk assets (such as equities).

The Fund provides global exposure to a diversified range of assets by primarily investing in funds. The Fund typically invests more than 70% in sub-funds of an Irish UCITS fund (Fidelity Common Contractual Fund II) operated by Fidelity which subsequently utilise the experience and specialisms of a number of investment managers (which may include Fidelity) to manage the underlying assets.

The Fund can also invest directly into other collective investment schemes (including schemes operated by Fidelity), transferable securities, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes.

As a result of these changes, the OCF of the underlying fund will increase by 0.25%.

Funds and Products affected by these changes

Sterling Bond
Sterling Fidelity Wealthbuilder
Sterling Fidelity Wealthbuilder 2

Zurich Pension
Zurich Fidelity Wealthbuilder ZP
Zurich Fidelity Managed EP*
Zurich Fidelity Managed 1% AP*
Zurich Fidelity Managed 2000 AP*

Zurich Investment Bond
Zurich Fidelity Managed 2000 AL*
Zurich Fidelity Managed AL*
Zurich Fidelity Managed*

*These funds invest in the Fidelity Wealthbuilder fund.

Sterling ISA and Sterling Investment Account
Fidelity Wealthbuilder Y Acc

Fidelity Multi-Asset Strategic

The new fund objective and investment policy will be:

The Fund aims to provide long term capital growth through global exposure to a balance of lower and higher risk assets.

The Fund provides global exposure to a diversified range of assets by primarily investing in funds. The Fund typically invests more than 65% in sub-funds of an Irish UCITS fund (Fidelity Common Contractual Fund II) operated by Fidelity which subsequently utilise the experience and specialisms of a number of investment managers (which may include Fidelity) to manage the underlying assets. The Fund can also invest directly into other collective investment schemes (including schemes operated by Fidelity), transferable securities, money market instruments, cash and deposits, and is also able to use derivatives for efficient portfolio management and investment purposes.

Asset allocation exposure of the Fund will be actively managed and typical allocation will be as follows: 50% lower risk assets (such as debt instruments e.g. bonds and cash) and 50% higher risk assets (including equities, commodities and property securities). However, the Fund’s allocation between lower risk and higher risk assets can be tactically adjusted within the following range in order to preserve capital or take advantage of market opportunities: in all market conditions, 30-70% lower risk assets and 30-70% higher risk assets.

As a result of these changes, the OCF of the underlying fund will increase by 0.28%.

Funds and Products affected by these changes

This affects your clients invested in these funds through the following products:

Sterling Investment Bond
Sterling Fidelity Multi Asset Strategic
Sterling Fidelity Multi Asset Strategic 2

Zurich Pension
Zurich Fidelity Multi Asset Strategic ZP

Sterling ISA and Sterling Investment Account
Fidelity Multi Asset Strategic Y Acc,

There are also funds affected by these changes on the Zurich Intermediary Platform. Please see the attached documents from Fidelity for more information.